Search? Yahoo? Isn't this the same company that farmed out its search backend to Microsoft's Bing for a decade?

It is indeed, but Mayer's "search" is not the type of Google homepage query you're thinking of. Mayer is betting that Yahoo can beat Google at contextual search, where users get specialized results based on a variety of factors like location, time and previous behavior.

"When I look at things like contextual search, I get really excited," Mayer said at the conference.

Contextual search seeks to take in a variety of factors aside from a simple input to generate results that are tailored to a person's time, place and patterns.

For instance, a normal search for sushi might turn up a Wikipedia page or various websites about sushi. If one were to look up sushi from a phone through a contextualized mobile search, it could conceivably return nearby sushi restaurants with review, advertisements and coupons.

The reason for Mayer to get excited is twofold: Nobody has yet mastered contextual search and it has the possibility of generating a ton of revenue.

"With so much search traffic moving to mobile, it is definitely the place to be and why search engines are working hard on their mobile search strategies. When you consider how much of Google's revenue comes from search ads, you quickly realize why it is so important for Google to be first and foremost in this space, and why Yahoo wants a piece of that pie," said Jennifer Slegg, a search engine marketing consultant.

Google has been introducing elements of this to its normal search. Here is a picture of a search for "sushi" from earlier today:

Google identified my location and served up some sushi restaurants and lists, along with some ratings from Zagat, the restaurant ratings guide Google acquired in 2011.

Mobile search is seeing particularly strong growth in local searches, according to media consultant BIA/Kelsey.

Contextual search has been a long-predicted next step in the evolution of search, but has been slow to emerge. With the mobile phones now nearly ubiquitous, and more search and web traffic going through mobile devices, the stage may finally be set for contextualized search to make an impact.

In addition to the Yelp partnership, many of Yahoo's recent acquisitions have brought in talent that center around mobile and contextualization, particularly Aviate, which attempts to tailor smartphone home screens to the time and location of the user.

While Google has a head start, contextual search on mobile devices is still an area up for grabs.

"It's so early on, Marissa Mayer thinks that Yahoo can compete in that area against Google, Bing and others," said Barry Schwartz, CEO of RustyBrick, a New York Web service firm specializing in customized online technology. "I think Mayer is right in that if Yahoo wants to compete, they have to look at what's still available to take a bite out of the market share."

And as Mayer pointed out, 80% of advertising budgets still go to television. If Yahoo or any other company were to demonstrate an effective contextual mobile ad experience associated with its search and take a slice of that spending, it could mark a significant shift in the online marketplace.

"Yahoo has been lagging behind Google, Facebook, and Microsoft in online ad share for quite some time, so they definitely need to take some action to get back in the game of Ad search revenue. Because contextual and mobile is the future they are definitely on the right track in focusing in this area," wrote Gerald Weber, founder of Search Engine Marketing Group. "Their recent acquisition of Aviate is also a right step in that direction. I'd have to say the monetary upside potential is exponential if Yahoo is able to follow through with their plans. Only time will tell."

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